Dubai SME takes crowdfunding support to entrepreneurs to the “Next” stage

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It will all add up – the Dubai Next program allows startup founders to try and impress potential funders beyond the usual channels.
Image Credit: Gulf News

Dubai: Crowdfund your startup – Dubai’s efforts to open up new funding channels for its entrepreneurs are gaining momentum.

The ‘Dubai Next’ project allows these entrepreneurs to go online and be seen and heard by potential investors. More than 540 campaigns have been launched, of which 44 have been put online.

If previously people with ideas had to get funds from banks and specialist investors, “what we have done is sort of democratize that further,” said Abdul Baset Al Janahi, CEO of Dubai SME. Dubai Next has so far received MAD 27.7 million in funding requests, as well as 72 contributions from 58 supporters.

Release funds

Dubai startups and entrepreneurs received more than Dh 192 million in incentives from Dubai SMEs in 2020, up from Dh 170 million in 2019. The number of Dubai SMEs members reached 4,786 at the end of 2020, of which 74% were commercial licenses and the rest in “Intelaq”. category for home businesses.

Easier for talent

“In the post-COVID era, talent and capital are likely to be even more mobile, especially in target sectors such as the digital and creative industries,” said Scott Livermore, chief economist at Oxford Economics Middle East. “Therefore, simplifying the start-up process will improve Dubai’s competitiveness in this area.

“Recent movements in Dubai and the United Arab Emirates are aimed at encouraging innovation – and often such innovation is done through startups and SMEs.”

Abdul Baset Al Janahi

Abdul Baset Al Janahi, CEO of the Dubai SME, provides an update on the Next crowdfunding platform.
Image Credit: Clint Egbert / Gulf News

Crowdfunding model used

The Dubai SME used an all-or-nothing model to protect activists and minimize risk for everyone. By not releasing funds unless a project achieves its goal, this ensures that entrepreneurs sponsored by Dubai Next have enough money to do what they promised and that they are not expected to complete a project. project without the funds to do so.

What are the fees?

Dubai Next is a non-profit platform and there is no registration fee. However, a 5% service charge is charged for successfully funded projects.

How is this platform different?

It is the premier UAE based crowdfunding platform for startups and is operated by the Government of Dubai. Unlike other platforms, activists retain 100% ownership of their project; there is no loss of equity or any form of share ownership or profits.

Register

Currently, the website only supports UAEPASS, a national digital identity solution.

Fund release

Once the funding target reaches 100%, the amount will be released through the Dubai SME, which will provide the necessary support to start and grow the business – from the issuance of business licenses to training and incubation.

“We expect to see a flood of young creatives take advantage of a previously unavailable funding stream that will accelerate their growth,” said Scott Cairns, Managing Director of Creation Business Consultants.

Crowdfunding mode

Crowdfunding is an approach to raising capital for a business enterprise – or cause – by a group of people. The traditional method of raising capital allows entrepreneurs to approach only a group of traditional investors, thus limiting options.

A crowdfunding platform allows entrepreneurs to reach thousands of potential investors from this single platform, greatly increasing the options.

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